The Ambassador in Italy (Kirk) to the Secretary of State
[Received 7:45 p.m.]
2868. Reply has been received from Italian Government to Embassy’s aide-mémoire submitted to Italian Government as reported in penultimate paragraph my telegram 1729, June 24, which brought to attention of that Government the additional points regarding Italy’s petroleum policy contained in Department’s 552, March 22. Summary of note follows:
- To the granting of most-favored-nation treatment to American citizens and entities engaged in production, refining and distribution of petroleum products in Italian territory, note expresses Italian Government’s agreement; it adds that existing petroleum legislation does not envisage any distinction between Italian citizens and entities and foreign ones and that latter are therefore juridically treated in the same manner as nationals.
- Concerning treatment to be accorded importation of petroleum products by American citizens and entities note “confirms” that Italian Government’s guiding policy is to recognize in case of restriction by quotas (in case di contingentimento) the right of importation of quotas in proportion to imports made in a determined base period. This system, the note comments, was followed in the past.
- Note states that Italy’s petroleum policy will aim to provide the greatest benefit for the collectivity. While the Italian petroleum entities have not the traditions of the foreign companies which have been able to operate on a broad scale, they have nevertheless adequate equipment and organization and have given proof of their efficiency. [Page 1319] Moreover a co-interest in those entities on the part of the state does not mean the adoption of measures in their favor as against other private firms.
- Italian Government is not aware of any practices in which AGIP (Abr. unknown) and ANIC (Abr. unknown)59a have engaged prejudicial to competing foreign companies. Should however evidences of such practices be brought to knowledge of Italian Government latter will not fail to take due consideration of them. On the subject of preferential treatment alleged to have been enjoyed by entities in which Italian Government is interested, note confines itself to reference to what was set forth on the subject in its previous note verbale of June 18, 1945 (for text of latter see Embassy’s despatch 1792, June 25).60 End summary.
With regard to foregoing, Petroleum Adviser Frothingham, who is now en route to US, commented especially on the vague reply which note contains with respect to prejudicial treatment which has previously been accorded to American companies but the existence of which note does not admit. Such treatment, he said, can be amply documented by the companies concerned. It is understood that he will discuss this and other petroleum matters in Washington. Embassy will await Department’s instructions regarding making of further communications to Italian Government on subject.
Text of note summarized above follows by despatch.61